The Digital Gold Rush

The recent waive of initial coin offerings (“ICOs”) has completely altered the crowd funding landscape forever. Almost overnight, companies from around the world realized that funding for their project was no longer in the hand of few VC’s or angel investors; leveraging the global reach of cryptocurrency, founders now have a new weapon for raising money quickly. Although most, if not all ICOs are for companies in the blockchain technology space, the wide array of companies raising funds has brought in an influx of new investors who are beginning to see the disruptive potential of cryptocurrency.

Take Filecoin, one of the few recent ICOs vying for the tile of “Decentralized Cloud Storage King”, as an example of the level of innovation being witnessed in the ICO craze. Filecoin is a decentralized storage network that turns cloud storage into a competitive marketplace. The market is stored on a blockchain using Filecoin, the native protocol token. The network offers cheap storage space to clients while incentivizing miners through two different types of rewards. Miners can sell storage space or offer retrieval services in exchange for a fee. On August 10th, after an initial delay, Filecoin had the largest ICO in terms of money raised, with a jaw dropping $252 million raised.

Other companies, like Avalon, are trying to take real world business models and applying them directly to the blockchain in ingenious ways. Avalon is a premier members-only platform, and the first GPO (group purchasing organization) that represents the cryptocurrency consumer-base and its purchasing power. Think of them as the “GroupOn of blockchain. The Avalon Platform will allow members to realize discounts on goods and services they purchase, as well as the opportunity to earn tokens by participating in promotions, scanning proof of purchases, playing games, utilizing p2p smart contracts and so much more, all housed under one exclusive roof.

Even the gaming space is being transformed and molded by the cryptocurrency boom. Gaming and digital currency have always been a dynamic duo due to the market for digital goods, however, a new game called Hash Rush brings unique angle to their game: the ability to leverage the power of bitcoin mining to actually allow players to earn money while playing. Hash Rush is the first strategy game that is powered by real hashing power. On the surface, the game is set in a fictional solar system where cryptocurrencies are the main source of income; the objective is to manage the colony, take over neighboring territories, and transform your colony into the talk of the crypto world. Using their Rush tokens, players can improve their mining colony with various upgrades that improve overall hash power.

The sheer scale and variety of ICOs that have surfaced over the past few months emphasize the fact that this form of funding may be here to stay. Over the next few months, events such as decisions by regulatory bodies around the world will help shape the direction of the ICO method. However, for now, companies like Filecoin, Avalon, and Hash Rush are disrupting their respective spaces at a rate that has not been seen since the advent of the modern internet age of the mid 90’s. As the cryptocurrency industry matures and deals with regulatory scrutiny, it will be very interesting to see what path the ICO is headed for.

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